Net invitation site Evite seeking a buyer

Evite.com, a company that allows people to send party invitations over the Internet, is looking for a buyer, the company's chief executive told CNET News.com on Friday.

Evite has hired investment bank Chase H&Q to help find a buyer. But Evite CEO Josh Silverman said that Evite has $17 million in cash and is not in any immediate danger of shutting down, unlike many other e-commerce companies.

The move may signal that San Francisco-based Evite is trying to head off such a crisis, however.

"Our ad-supported business requires scale to be effective," Silverman said. "In today's market, it has become increasingly difficult to build adequate scale independently."

Evite and most other online party-planning sites have proven popular with consumers but have yet to show profits. Most provide party-planning services free of charge and rely on advertising sales to make money.

Many sites with this kind of revenue model have struggled to find new funding as investors have fled e-commerce stocks. The result is that a slew of dot-com companies are running out of cash, and many others have already ceased operations.

Some of privately held Evite's competitors have been sold in the past year. For example, eParties was acquired by online toy store eToys in June. Another competitor, TimeDance.com, closed in July.

News.com's Troy Wolverton contributed to this report.